I think that the Law Lords you mention would be surprised to be told that their brief comments were supposed to be a comprehensive statement of the law. And did Lord Goff really think that the whole question of liability can be disposed of just by rejecting the "supposed liability" test, as if there were only one alternative to it ? I wonder.

Consider :

Example 1 Hedley enters into a business arrangement with Birks. As part of this arrangement, Hedley is to pay sums to Birks' nominee, O'Dell, with whom Hedley is not in direct contractual relations. Soon after the payment is made, Hedley demands his money back, saying that he considers the Irish to be unreliable people with whom one should never do business. Hedley is found by the trial judge to be hopelessly anti- Irish, and it is found as a fact that he would not have made the payments had he known O'Dell's nationality. The trial judge can give no clear account of why Hedley failed to realise O'Dell's nationality at first, though he suggests that Hedley's rather low intelligence may have something to do with it.

Example 2 O'Dell starts a new political party with controversial aims. In an opinion poll, roughly one-tenth of one percent of the sample declared themselves in favour of this party. Hedley misreads the newspaper article reporting the poll. Thinking that in fact one-tenth of the electorate support O'Dell, he sends a contribution to what he supposes is a significant force in Irish politics. On discovering the truth, Hedley demands his money back.

In both these examples, it would in my view be absurd if the claim succeeded, or if the defendant were driven to rely on defences such as change of position, which he might or might not be able to establish. And if Eoin knows of any cases -- English, Irish, Australian or whatever -- which support liability that broad, I'd be very interested to hear of them.

That is why I object to the broad mistake view Eoin proposes, which is entirely subjective on the payor's side. English cases come nowhere near to establishing the broad proposition contended for, and this broader result is undesirable. There is no particular justice in allowing recovery merely because there was a mistake. It seems to me that there has to be a significant category of mistakes which are the payor's business alone, and which should not give rise to liability to refund the money.

So while I would not want to go back to the "supposed liability" test, nonetheless it is neither necessary nor desirable to sweep away *all* limits on the type of mistake. And it is certainly an extravagant way of justifying the result in Simms, where the payment was clearly made on the (false) basis that it fulfilled client instructions. To allow recovery on discovery that the basis is false is not quite "supposed liability", but it is only one step beyond. The decision is not a licence to recover for any causative mistake, of any kind.

Steve Hedley

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